Iran reveals uranium, but pledges peaceful use

Iran has discovered and extracted uranium to produce nuclear energy, but it insists its nuclear power program its strictly for civilian use.

This surprise announcement by President Mohammad Khatami on Sunday - the first time an Iranian leader has acknowledged Iran has uranium reserves - is likely to alarm the United States.

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Mr Khatami said the uranium had been extracted near the central city of Yazd and processing facilities had been set up in the cities of Isfahan and Kashan, also in the central area of the country.

Iran - one of the US's "axis of evil" - has invited inspectors from the United Nations nuclear watchdog, the International Atomic Energy Agency (IAEA), to verify the facilities this month.

The US has long been at odds with Russia for helping to build an $800 million ($1.35 billion) nuclear power plant at Iran's south-western port of Bushehr, which Tehran expects to come begin operating within a year.

Russia has assured the US that all spent fuel from the plant will be returned to Russia, thus ensuring it would not be diverted to a weapons program. But the discovery of its own uranium supplies could make Iran independent of Russia for its nuclear fuel needs.

Diplomats said Mr Khatami's announcement was the result of international pressure on Iran to come clean about the scope of its nuclear program.

The head of the Iranian parliament's Energy Commission, Hossein Afarideh, said the extracted uranium, after being processed, could be used as fuel for the Bushehr power plant.

Iran had been searching for uranium for years, Mr Afarideh said. "It is the first time that extraction operations took place."

The US has raised concerns about the Bushehr plant and about newly disclosed plans for two other nuclear plants.

An Iranian dissident group, the National Council of Resistance of Iran, said in August that it had learned from sources within Iran about two secret nuclear sites under construction.

One of them, about 40 kilometres south-east of the city of Kashan, was to be used for nuclear fuel production.

The site included two large spaces that are about eight metres underground. There was another facility, which was meant to produce heavy water, along a river near the central city of Arak, the council said.

Iran has large oil and gas reserves, and the US argues that there is no need for the country to develop nuclear energy.

Iran is also a signatory to the Treaty on the Non-Proliferation of Nuclear Weapons, and has rejected claims that it is trying to acquire weapons of mass destruction.

It says that nuclear plants are needed to help increase its electricity generation.

"We are ready to accept inspectors to check our [nuclear] activities in order to reveal the lies told by others," Mr Khatami said on Sunday.